Australian wine export market smashes through Aus$3bn mark

AUSTRALIA: Exports from Australia's wine industry have broken the A$3bn (1.28bn) barrier for the first time, latest figures show.

The UK remains the biggest buyer Aus$974m (412m), but the US Aus$962m (407m) is closing in fast, and China Aus$51m (21m) has emerged as a growing market.

In the 12 months to July, export wine sales rose by 8% in value to more than Aus$3bn and 10% in volume to 800m litres, the latest figures from the Australian Wine and Brandy Corporation show (AWBC)

The average price declined by 2%, but this was due to bulk wine prices falling by 10 cents, or 9 per cent, to $1.02 (43p) per litre. Bottled wine prices were up 6 cents, or 1.3 per cent, to $4.86 (2.06) per litre.

AWBC chief executive, Sam Tolley, said the results underlined the contribution of wine to Australian exports. Wine was now the third largest category in agriculture after grains and beef, and ahead of dairy and wool.

Tolley said higher-priced bottled wine exports "is the direction the industry targeted in its recent strategy.

"It's early days, but it's the start of a trend we hope will continue."

He added that the emergence of China was exciting: "They are advancing beyond the low-price bulk market to bottles. China is destined to become more important."

Canada was also showing a liking for high quality wine, with sales up in value by 11% and only 1% in volume.

Australian wine exports reached Aus$1bn in July 1999 and Aus$2bn in July 2002. It took another five years to reach Aus$3bn because of declining prices, Tolley said.

The figures show that bottled shipments in the year to July grew by 34m litres, or 6% to reach 563m litres.

The main driver of this growth was red bottled wine, which grew by 30m litres. Bottled white wine grew by just 1.7m litres. Red wine prices rose on average by 10 cents to $5.15 7.08) per litre, while bottled white wine fell by 3 cents to $4.25 (5.84) per litre.

Bulk wine exports rose 20% to 228m litres, well down on the 50% growth in the previous 12 months.